Report says three early Libra backers might drop support for cryptocurrency

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This undated image obtained June 17, 2019 courtesy of Libra Press shows the logo graphic for Libra. – Facebook is leaping into the world of cryptocurrency with its own digital money, designed to let people save, send or spend money as easily as firing off text messages.”Libra” — described as “a new global currency” — was unveiled June 18, 2019 in a new initiative in payments for the world’s biggest social network with the potential to bring crypto-money out of the shadows and into the mainstream. Facebook and an array of partners released a prototype of Libra as an open source code to be used by developers interested in weaving it into apps, services or businesses ahead of a rollout as global digital money next year. (Photo by Handout / Libra Press / AFP) / RESTRICTED TO EDITORIAL USE – MANDATORY CREDIT “AFP PHOTO / LIBRA PRESS TEAM/HANDOUT” – NO MARKETING – NO ADVERTISING CAMPAIGNS – DISTRIBUTED AS A SERVICE TO CLIENTS / TO GO WITH AFP STORY by Glenn CHAPMAN – “”With ‘Libra,’ Facebook takes on the world of cryptocurrency””HANDOUT/AFP/Getty Images

Facebook might soon find the room a little less crowded the next time it meets up with the backers of its Libra digital currency.

According to a report Friday by the Financial Times, two backers behind the Libra Association — the group led by Facebook to support the development and usage of the cryptocurrency — are said to be considering dropping out of the group due to the regulatory spotlight on the Facebook’s efforts. A third backer is said to be concerned about showing public support for Libra because of the attention it might draw to its business ventures.

In June, Facebook announced the creation of the Libra Association. At that time, the social media giant said 28 companies — including its new subsidiary, Calibra, and partners such as Uber, Visa, Spotify and Mastercard — pledged to invest a minimum of $10 million to develop Libra. Facebook also said that Calibra would create a digital wallet for Libra usage, and that the wallet would be available for use in its Facebook app, Messenger and WhatsApp services starting in 2020.

Libra has yet to become available for public use, but the proposed cryptocurrency has already been subject to close scrutiny from lawmakers and governmental regulators.

Congress held hearings in July that included testimony from Treasury Secretary Steven Mnuchin, who voiced concerns about how Libra could be used for illegal and illicit activities. In Europe, the European Union antitrust officials have already started an investigation into Libra and how it might be regulated.

Facebook didn’t immediately return a request for comment about the Libra matters.

Rex Crum is the senior web editor for the business section for The Mercury News and Bay Area News Group. He also writes about business and technology for the publications' print and web editions, and has covered business and technology for nearly two decades. A native of Seattle, he remains a diehard Seahawks and Mariners fan and is imparting his fandom to his Oakland-native wife and two young daughters.

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